60. Going back a few minutes, we were talking
about audience response, and extending that to audience share,
I noticed that BBC figures nationally have overtaken ITV for the
first time. I am sure this is a tremendous achievement. I know
in Scotland that has not yet happened, that you are still behind
ITV. Is your commitment to news and current affairs broadcasting
seen perhaps as restricting your ability to overtake ITV in audience
share, or do you see the potential for expanding it as being an
opportunity to further enhance your leadership?
(Mr McCormick) Certainly within the performance of
the channel as a whole, BBC1 Scotland, the trend of the last year
where the audiences have overtaken ITV on a UK basis has also
been matched in Scotland where historically the ITV companies
in Scotland were 9 or 10 points ahead of BBC1 Scotland, and we
have now narrowed the gap to around 3 per cent, which is a matter
of some satisfaction. We are going to be developing that. That
is one of the reasons for the policy of investing in a contemporary
drama that is there twice a week and a broader range of entertainment
programmes. These are always very, very competitive areas to operate
in. Some you fail, some you win; but the success of something
like Chewin' The Fat which on Friday night got 46 per cent
of everybody watching television in Scotlandthey were watching
that single programmeindicates that we want to provide
a broad range of programming that has a resonance with the audience
across Scotland. So we would say very often, on nights when EastEnders
does not play, we often find that Reporting Scotland has
the highest audience for any programme in peak time on BBC1 Scotland.
So certainly that indicates to us the appetite for news. What
we want to do, based on our talking to audiences, is this. We
had a major piece of research 18 months ago where basically conclusions
could be summed up as people said to us, "We like your current
affairs and we like your news and that Kirsty Wark is great and
Ann McKenzie and Gordon Brewer. We like all that. You are very
good at that, but could you make us smile a bit more." As
a result of that, out came the policy which resulted in Chewin'
The Fat and contemporary drama and a bit more emphasis on
entertainment, to redress the balance from the increased amount
of news and current affairs that we produced following devolution.
We will be in a position to assess how well we are doing at the
end of that two year period this time next year, when we will
have completed the cycle of that investment, had some failures,
hopefully had some successes to match the ones we have at the
moment and build on that. It is basically a competitive business.
The search for audiences in the multi-channel environment has
never been harder or harsher. We are looking at it over a five
year period. We would hope that by the time we move into Pacific
Quay at the end of that five year period we are looking at, that
we have managed to strengthen the whole base of the BBC in Scotland,
both in terms of investment and production, but delivering to
the audiences on radio and television and online within our Gaelic
services and our English-speaking services a much wider range
of programmes, so that we can bring the BBC, and BBC1 Scotland
particularly, closer to the audiences in Scotland. It is very
important to us, the existence of one BBC, and we want the people
of Scotland to feel closer to the channel. They have been saying
to uswe did with the news and current affairs again get
very positive feedback to that - "Strengthen your entertainment
and your drama specifically for Scotland." We are getting
very good feedback to the network dramaMonarch of the
Glen, Two Thousand Acres of Skye, a new series coming
up Rockfacea whole range of programming that we
have been doing. We are getting a terrific response to that, but
we want to strengthen the local entertainment programmes specifically
for audiences in Scotland. I hope that we can begin to assess
that in a year's time so that by the time we move into Pacific
Quay we have a very broad based programming which says to the
people of Scotland, that they will get a good return for the licence
fee investment.

Ann McKechin

61. Sir Robert, the Broadcasting Council's written
submissions state that there is more to be done in reflecting
the UK to the UK.[3]
How do you believe that broadcasters in Scotland can work to achieve
that?

(Sir Robert Smith) I think first of all
by giving them resources. John indicated we have moved from something
like £95 million in 1998/99 and in the next year, 2002/03
we have £160 million. That does not guarantee excellence
but it does give an opportunity to produce some programmes because
I think that reflecting Scotland to the rest of the UK and the
rest of the UK to Scotland, Scotland to the rest of the world
and Scotland to Scots actually, it is not just about news and
current affairs. It is about drama, it is about factual, it is
about entertainment and how Scots are portrayed in these. I think
this is an opportunity. BBC Scotland cannot complain about lack
of resources. What they need to do now is to respond to the challenge
of this extra money and produce quality programmes in these other
areas, not just news and current affairs, that actually reflect
Scotland. I think that is what we have in mind.

62. Do you believe they could better use the
resources of the BBC and the World Service and the wide range
of contacts that the BBC has within BBC Scotland programmes?
(Sir Robert Smith) I think you probably could. It
is very easy to criticise in detail these areas but yes. A recurring
theme, and I actually raise this frequently at Governors' meetings,
is that I cannot believe that Rwanda has gone away. I cannot believe
it. We have 2,500 UK journalists for the BBC combing every country
in the world. We speak 160 languages on the World Service. There
seems to be a fashion in the news, that we go for a particular
thing and it tends to be flogged to death.

63. I think development issues have actually
declined substantially through all news coverage in the last ten
years. I think it may be something like 20 per cent less, and
that includes institutions like the BBC. Do you not believe given
the events we have had in the last 12 months, that there is a
real case for having much better emphasis on that throughout broadcasting
services?
(Mr McCormick) Before Roger takes up the main point,
I think it does tie into the point that you made earlier about
having the world focus and international perspective in the programmes
that we produce in Scotland. As Blair said, we have been trying
to do that more and more in recent times. But this is an interesting
aside; it is perhaps important to note that producers based in
Scotland are also contributing programmes to the World Service,
programmes commissioned by the World Service from our colleagues
in Aberdeenlong running series as well as weekly diaries
and news input into the World Service coming from Scotland. That
is a strong development for us.
(Mr Mosey) I think it is a good point. The two things
I would say are firstly, we now have two news channels in BBC
News 24 for the UK and BBC World Worldwide, which actually do
have the amount of air time that can look at issues in greater
depth, and we do that. I think the only caveat as a second point
is that the 10 o'clock news every night is only 25 minutes long.
In 25 minutes, when you have the commitments we have to reporting
the UK, to reporting the world, to reporting the range of stories
there are from business or from world affairs, 25 minutes is not
very long. Therefore the frustration about it is that our absolutely
peak air time is comparatively compressed. Increasingly, people
are going to the news channels, like News 24, to be able to get
greater depth and greater background and a wider range of stories.
(Sir Robert Smith) I think the trouble is fitting
quarts in to pint pots. There are individual governors like me
who believe there should be more business coverage in the national
news at 10 o'clock. There are others, like Sir Richard Eyre, who
believes there should be more arts coverage and is appalled at
the level of arts coverage. If you take 25 minutes of your prime
time to cover wars and famines, and so on, it becomes quite difficult.

Chairman: We are going to move on now to the
impact of OFCOM .

Mr Robertson

64. As you know, the Communications Bill was
expected later this year and only last week the second reading
of the OFCOM Bill went through. There has been great debate about
the BBC and its connection with the Bill, but can I take the generality
of what effect on news and current affairs broadcasting in Scotland
will the establishment of a new media regulator OFCOM likely to
have on your company?
(Mr McCormick) I do not anticipate it having any change
at all. Sir Robert, perhaps you want to come in first? As you
know the different tiers of the regulatory structure of OFCOM
and the BBC's governors, the independence of the BBC's governors
is something we have been arguing about. We have always believed
in the strength of plurality of regulation. We think that is the
right way to regulate a publicly funded broadcasting system. What
we're interested ourselves and the Broadcasting Council for Scotland
are interested in, is ensuring that when OFCOM is created that
the views and opinions of people in Scotland are properly reflected
within that structure. We are not too clear what the structure
will be and we note the fairly high level and probably a small
body at the top with a range of supporting committees. I think
it is very important for us that the voices of the different parts
of the United Kingdom are reflected in OFCOM and that is something
that we are putting particular effort into trying to argue the
case for that, to make sure it does not becomeand hope
it will not becomea body based in London speaking from
a South England standpoint, but that it reflects all the range
of opinions. In answer to your direct question, however, we would
not anticipate it having any direct effect at all on our journalists.

65. Would that be because the BBC does not come
under the OFCOM umbrellathough it is still conceivable
as it is still to be debated. My next question is an automatic
follow-on from that. Do you not think it is time for the BBC to
come under the OFCOM umbrella and be open to the same regulation
as companies like the ITV companies?
(Mr McCormick) As I have said, we have always believed
in the strength of the plurality of regulation, and the strength
that comes in through a licence fee funded non-commercial body
and the unique nature of the BBC, and its unique governance is
one of its strengths. We strongly argue that case. It does not
mean to say that the standards that OFCOM will set for broadcasting
will not apply, in some cases, to the BBC. The different levels
of tiers of programme complaints and standards will apply also
to the BBC. In fact over the last ten years, the BBC has been
the pace-setter in setting producer's guidelines and producer's
standards and they have created the benchmark in many cases that
other broadcasters have been happy to support and to follow. So
there is no sense or any sense that we would expect to get treatment
that was different in terms of our public responsibilities. Under
our Royal Charter, and with our separate Board of Governors, we
feel that has been a strength of the BBC since it was founded
nearly 80 years ago. We would like to see that continue. Plurality
of regulation and an independent Board of Governors interpreting
the Charter for the public good we think is a stronger position
to go forward for the BBC than coming under the same umbrella
as every other broadcaster.

66. Do you have an opinion, Sir Robert?
(Sir Robert Smith) It is the same view, but it does
not come from the same hymn sheet necessarily, but it is my view.
I actually believe that an OFCOM that is trying to regulate the
independent sector and a public service organisation is going
to come under tremendous pressure. I think that actually could
be to the detriment of the public service service, if you like.
I have nothing against regulation. I think regulation should be
very strong and I actually think BBC governors exert strong regulation.
There are other areas of government that also provide control
on these things, like monopolies and various other areas that
apply also to the BBC. I think if OFCOM is to come in in a particular
way, we have to be sure that it does not damage the independence
of the BBC and that pressures do not come on it from commercial
aspects from one regulator looking at both commercial and public
service. I think it is quite difficult.

67. Do you not accept, though, that the BBC
operates in its own way? It has its own adverts; it advertises
itself; it puts itself up in competition against the ITV companies.
The BBC itself has changed over the years. So perhaps it is time
to bring it in line with everybody else, and to put it under that
umbrella.
(Sir Robert Smith) We do not take advertising on our
normal programmes. You say we advertise on our own channels the
forthcoming programmes and so on, but we do not take advertising
from the public, except in very specialised commercial areas which
are very, very highly regulated with a Fair Trading Committee
that monitors that. I do not think I would be one, and I guess
the independent companies would not argue, for the BBC to take
advertising either.
(Mr McCormick) I think the key factor, for me, as
an individual who believes in the BBC and supports it, is that
unique system of funding. We are privileged to have the licence
fee as a unique system of funding. That brings with it its own
scrutiny, rightly. All our other broadcasting competitors are
commercially funded and their first obligation is to keep their
company solvent, and then deliver a service which they hope will
attract the audiences to keep the company solvent and hopefully
move into profit. Our pressures are different. Our pressures are
making sure that the more than 20 million homes across the UK
that pay the licence fee get a return for that licence fee according
to public service standards and according to the Royal Charter
and the Agreement. It is a completely different set of rules and
it is a completely different system of scrutiny. More should be
expected of the BBC in terms of public service obligations than
you have a right to expect of commercial companies who, at the
moment particularly, are undergoing particular pressures in earning
their own income. It is a completely different set of circumstances.
It does not mean that the programme codes and the programme standards
that are expected of the commercial companies will not apply to
the BBC. We would gladly accept them and heed them and, perhaps,
extend them because we are a publicly funded broadcaster without
the commercial pressures of our colleagues in commercial broadcasting.

Mr Sarwar

68. It is very important that the BBC is aware
of the needs of our ethnic minority communities in Scotland and
in Britain. Do you think, in terms of programming and in terms
of jobs, there is a fair representation of our communities?
(Mr McCormick) There is a bit to go. One of the key
areas to start this change is to improve our system of portrayal.
Of course, it begins with employment practice. We set ourselves
fairly modest targets in terms of recruitment to match the population
within our main centres so recruitment into BBC Scotland matches
the pattern of the population within Scotland. That is the same
in other parts of the BBC. But we are setting ourselves now with
the Board of Governors and with the Broadcasting Council for the
next few years more stretching targets than that. We want to make
sure that the people who are employed by the BBC are much more
socially inclusive than traditionally they have been. I think
we have made significant developments, and taken great strides
forward, in the past couple of years. We have initiated a number
of different projects to stimulate creative work for drama writers'
projects; for example, for Asian writers a whole range of new
trainee schemes relating to people from different ethnic communities,
to make sure that behind the scenes in terms of producing, editing,
programming and also on air that will reflect the diversity of
the voices across the United Kingdom. We have a decent record
of that in Scotland but we are setting ourselves a higher target
for the coming year. That is because we benefit from that range
of views, of being much more socially inclusive. It does not just
extend, Chair, to ethnic minorities; it extends to people from
all ranges of backgrounds. We do not want the BBC to be seen to
be the middle class white house on the hill. We want it to be
socially inclusive and bring people from all around Scotland from
different backgrounds and communities. We have developed a number
of schemes. We have an "E-Force" scheme to make sure
that people who are unemployed, people who come from disadvantaged
backgrounds, are offered an opportunity for some training. Then
it is up to them if they can transfer thatto equip them
better, to apply for a job within the media. We have a whole range
of schemes like that under way which we are hoping will bear fruit
in terms of the nature of our population and the jobs we are providing
over the next couple of years.
(Sir Robert Smith) Can I just say this. On BBC wide,
can I assure Mr Sarwar that Greg Dyke and his senior management
team are very sincere and very tough on this. They are absolutely
determined to get certain levels, percentages, and they have set
pretty tough targets in that area. There is a huge hunt on just
now for talentnew talentaround the UK.

Mr Carmichael

69. Just very briefly on the point, first of
all, about the BBC being under the same regulations as commercial
organisations. I think your point is a good one, John, that you
are not comparing like with like. I would just, however, float
past you the possibility that some of the operations that the
BBC is part of, such as the Teletubby merchandising aspect of
your operations, is very commercial and as long as you persist
in taking part in that sort of activity, then that is going to
be a difficulty for you. I think the BBC has maybe got some choices
to make in that regard. To come back to the point of OFCOM, which
is where we started originally, I think, John, it is probably
better directed perhaps to Sir Robert about all the different
parts of the United Kingdom being represented within OFCOM. I
have a particular concern that, in fact, if we have Scottish representations
within OFCOM that is going to be problematic because there are
different competing regional interests within Scotland. Are you
satisfied that the Government's proposals would be sufficient,
for example, to meet the difficulties which were experienced by
Grampian following their takeover by the Scottish Media Group
a few years ago which led to fairly heavy criticism from Oftel?
(Sir Robert Smith) I am not clear there is sufficient
detail in the proposals just now which tells us what exactly would
happen in Scotland and would happen regionally. There are several
different models which have been talked about in OFCOM for covering
Scotland. There is, obviously, a concern for the Broadcasting
Council. At the moment this is a Scottish body of people who look
at the output in Scotland and we try as hard as we can to represent
Elgin as well as the central belt. Exactly how OFCOM go about
this, and whether this would be London centric or whether they
would have a branch that reported it, I really do not know and
there is not sufficient detail in the Bill yet, as far as I know,
that would tell you.

70. We only have the proposal.
(Mr McCormick) I wonder if I might, Chairman, just
add a point on Mr Carmichael's point about the commercial revenues
in the BBC because it is an interesting issue. BBC Worldwide,
which markets the BBC's products internationally, the profits
from those go back into domestic production to supplement the
licence fee to provide better services for viewers and listeners
across the UK. It is a kind of virtuous circle in one way. I think
if the BBC was keeping its programmes and its product potential
associated with that and keeping it under the bed, as it were,
in a trunk and not exploiting it to the benefit of viewers and
listeners I think we would be open to criticism as well. I think
there are very, very strict commercial policy guidelines which
the Governors monitor very, very closely on the way that the BBC
markets products and the way that it sells its programmes internationally.
With the opening up of digital television around the world there
are many, many more service providers but there are very, very
few who are producing indigenous programming material. There is
a voracious market for, as they call it in the business, product
and the BBC is a brand name and people want to buy those programmes
from the BBC and show them internationally. That is an opportunity
which brings revenue back into the BBC to supplement the licence
fee and we benefit from that directly in Scotland. Monarch
of the Glen, for example, is the biggest seller the BBC has
at the moment internationally. Now that helps us in reinvestment
in other programmes down the line in Scotland and that benefits
into the production community in Scotland. I think the other searching
question to ask would be if we were not doing that, and, as it
were, keeping everything to ourselves and not exploiting the commercial
potential, as long as it is properly regulated, as it is, by the
Governors committee.
(Sir Robert Smith) In fact we were criticised, people
were saying we were sitting on rights. Would you believe that
sometimes we did not actually keep the international rights to
some of these things in the early days. When we went to look at
Bill and Ben or whatever, we had not really thought about
the commercial potential of some of these things but we were criticised
for sitting on valuable property and not doing anything. Provided
the money, as John says, goes back in, and last year it amounted
to something like £90 million of cash flow went back into
programme production, and provided it is a level playing field,
we are not artificially subsidising our commercial operation,
then I think it is fair. We monitor that very, very carefully.
We keep very careful notes of what we are doing on that side because
we know the other criticism will be levelled at us.

Mr Lyons

71. Going back to the point Mohammed raised
a minute ago, the question of the BBC trying to reflect Scottish
society. If we go along in future to Pacific Quay, we would be
comfortable with that social inclusion of Scottish society, is
that what you are saying?
(Mr McCormick) That is our aim, Mr Lyons. One of the
great advantages, frankly, of moving to Pacific Quay is that the
building will be much more open. The building will welcome people
in. Most of our buildings within the BBC, and certainly the 11
staff centres we have in Scotland, all but one of them were built
in the 19th century so although they have been adapted for broadcasting
purposes they are not exactly models inviting people in. You would
have the joy if you walked in to Pacific Quay of being able to
see on monitors everything that was happening in the building,
what was happening around Scotland and be able to have a route
that was safe and secure to see the operation. We will be positively
welcoming people in to that building. We are starting discussions
with businesses in the community as to ways as to how we can start
the work with the local community now, to talk to local schools
and community groups as to what the Pacific Quay project means,
so we can explain to them what is coming on the site, what we
hope to achieve by it. So by the time we go there we hope the
community will have a better understanding of what we are trying
to do and what we might in our own way bring to the community.
It is something we will be working with our own staff on and working
with the communities in Govan and Finnieston.

72. If we came along to Dumbarton to see even
if High Roads 
(Mr McCormick) We do not call it that. I find the
development at Dumbarton so exciting I would defy anybody not
to get excited and spend half an hour on that site and see what
is done on the old JV site. Certainly we would welcome, if anybody
is interested, anybody coming to see that development, to see
it in the first quarter of this year and then come back and see
it in six months' time when the programmes are in production.
It is a very, very exciting development for the whole of Scotland.
It is very welcome.

Chairman

73. Perhaps you would like to say something
about the anticipated impact on news and current affairs broadcasting
in Scotland of the advent of the digital age?
(Mr McCormick) That is a big one, Chairman, to finish
on. I just think it means more choice. We have been talking about
on-line, which is one of the advantages of the digital age. Certainly
within radio more services, in television more services and as
the technology becomes cheaper it means, also, that within our
production processes we can be much more up to date. We can provide
a wider range of services, much more inter-activity, getting closer
to the audience so the audience communication is much more direct
which means you get a better feedback from the audience directly.
The whole e-mail culture has changed the nature of a lot of our
programmes. As anybody who listens to Radio Scotland will be aware,
the e-mails flood in all the time and there is a demand for information,
so we feel we are getting closer to the audiences. In the fullness
of time over a five or ten-year period the main benefit of digital
will be more choice in what the BBC provides to you so you can
make the choice of a range of services whereas with analogue spectrum
we were restricted to maybe one or two services. Extending choice
is the greatest benefit.

74. Is it getting closer to the audience or
is it just getting closer to the chattering classes again?
(Mr McCormick) Time will tell. I am genuinely surprised
at the range of e-mails and the age and range of people who contact
us and hit on our web sites for news, for chat, for whatever.
I think we are getting to a wider audience than simply the chattering
classes but it is an important point. People using the Internet
are quite a wide demographic group.
(Sir Robert Smith) And the young in particular.
(Mr McCormick) People of all ages phoning into programmes.
On Janice Forsyth's programme on Sunday morning, a Scot living
in Copenhagen doing his ironing participated in the competition,
something we could not have dreamt of years ago. He said the Net
kept him in touch with Scottish affairs, and when he listened
to Radio Scotland on the Net he did not feel like somebody who
was cut off from his community because he was working there for
a couple of years. There are all those important advantages and
one of the direct advantages, for example, is that it does overcome
some transmission problems. Later next month Radio nan Gaidheal
goes on digital satellite which means that everybody who speaks
Gaelic in the United Kingdom who wants to access that Gaelic radio
service will be able to access that service, a very, very important
development for relatively modest investment.

Mr Joyce

75. It seems to me that this is a really exciting
time for news and current affairs with digitisation, I hope BBC3
in the future, and the options for choice and diversity are huge.
There are all sorts of exciting debates taking place right across
Scotland and the UKand I have been lucky enough to attend
a couple of meetings down here with the BBC. Are they the terms
and factors and variables that will dominate debate and discussion
over the next few years to come or will we be flung back to this
hackneyed, sterile debate about yea or nay for a Scottish service?
(Mr McCormick) We are seizing the opportunities that
digital presents. This is so fast-changingand you have
hinted at that yourself in your questionthat we could not
have anticipated the rate of change both behind the screen in
terms of production facilities even two years ago. There is a
range of opportunities opening up to us. There are now two versions
of BBC2 available in Scotland. That provides us with a whole range
of opportunities to do all sorts of things on the BBC2 service
without depriving people of the wider BBC2 service across the
UK. We would not have anticipated that development even two years
ago.
(Mr Mosey) Digital is incredibly exciting. News gathering
can be hugely more ambitious. We can bring live pictures in very
quickly and all the rest of it. The wider danger is that you lose
something which allows all of us to talk to each other in a national
debate. The answer to that is what the BBC can do is sometimes
put together a lot of services and a lot of strands in the digital
era and bring them together for the debate. John mentioned the
NHS Day which is not going to just involve BBC1 and the Nations,
it will also involve News 24 and Radio 4 and the web sites and
bring everybody together. So even if you do get fragmenting audiences
and people choose to watch things in different media and different
environments, you can still bring the national debate together
on the occasions when that is necessary. It sounds like a ghastly
bit of BBC propaganda, but I think it is true, that the BBC is
still best placed to do that.

Mr Robertson

76. I am very supportive of the BBC. I know
you might not think so because of some of the questions I have
asked you, but I am very supportive and as somebody who watches
particularly BBC2. I raised the point with you last year, John
(and you may not remember) where I said that the quality of the
BBC digital channels was poor, particularly BBC Choice. It has
improved but it is still the mundane programmes where they have
half hour bites and we do not get some of the good quality programmes
that the BBC have that I miss. I was looking for the BBC to show
these kinds of programmes. My question to you is this: are all
these channels that you are going to bring into service going
to detract from the quality of BBC programmes, something for which
you are renowned?
(Mr McCormick) I hope not. It is a fair question.
The budgets for BBC3 and BBC4 necessarily at this stage are much
smaller than for BBC1 and BBC2 which are universally available.
One of the great challenges for the BBC over this transitional
period is marketing. It is Government policy to encourage digital
take-up so that we can proceed with analogue switch-off at a particular
time. One of the great challenges as the children's channels are
launched and BBC4 is launched and then, if Government gives the
go ahead, BBC3 is launched, is that we will be marketing those
channels on BBC1 and BBC2 at the moment to a population where
the majority of people do not have access to them, the idea being
that you have to buy a new piece of equipment to enable yourself
to have access to these services. That is part of the whole take-upthat
we believe these channels will be attractive enough for people
to want to invest in that. But it is a very, very difficult decision
that the Governors had to take, I believe one of the most difficult
in the history of the BBC as to what proportion of the licence
fee investment should go into these new digital channels before
they are universally available, so the challenge for my colleagues
in BBC3 and BBC4 is to make those with smaller budgetsbecause
the lion's share of the budget should rightly go into BBC1 and
BBC2 that are universally available for people paying the licence
feebut to make them attractive enough, along with the BBC's
archives and using the quality of BBC programmes that people want
to see, and there is a vast number of people who do want to see
BBC programmes again. I think the combination of BBC1 and BBC2
plus BBC3 and BBC4 will give different emphasis to different types
of programmes. I think you as a BBC supporter will be finding
yourself turning to BBC4 more and more when it comes on the air
in March, which will have international news every night, which
will be showing a range of foreign language films that you do
not get to see on the other channels, which will be having a challenging
set of arts documentaries and performance of the arts involving
the Scottish Symphony Orchestra, among others, which will bring
a whole range of things which we do not have the space to do at
the moment on BBC2. It is extending the proposition and making
the portfolio much more attractive. As we move into the majority
of the population having digital and then into analogue switch-off,
it, then it becomes justifiable for the BBC to say to the people
of Britain "we are balancing up the budgets between these
channels because they are now all universally available".

Mr Lazarowicz

77. I can see there is the possibility of doing
something exciting. However, this question of quality does lead
on to the question of resources, does it not? Looking at the specific
question of news and current affairs broadcasting, which is the
subject of our inquiry, it is attractive to see the possibility
that at some stage, instead of having to choose between the Scottish
Six or the BBC News or Newsnight, you can just
watch any region, you can watch TV Edinburgh or TV Orkney, you
can choose all this at the same time. When is this going to happen
and how realistic is the possibility in the near future? Are we
going to have these kinds of debates about the Scottish Six
in three, four or five years' time? When will this change actually
happen and do you have the resources to allow it to happen in
Scotland? Do you have the resources to allow choice to take place
in the region?
(Mr McCormick) The specific example of BBC2, the choice
is available at the moment, anybody can choose between two versions
of BBC2 so if you have that choice at the moment if you are in
a digital home you can choose Newsnight Scotland or Newsnight
UK. Certainly as we move through the next period, BBC1 Scotland
is not available in the rest of the UK, it is encrypted for the
rest of the UK, so there is only one version of BBC1 Scotland.
We are discussing at the moment whether two versions of BBC1 should
be made and could be made available on satellite. It is a complicated
issue tied up with sports' rights and other rights at the moment.
We would like, as a matter of policy, to enable two versions of
BBC1 and two versions of BBC2 to be available, one version of
BBC3 which we contribute to and one version of BBC4. That then
opens up all the opportunities that we can then decide to put
our priorities to the resources as to where we think they would
have best effect and meet the audience demand. I do not think
it is too long away but at the moment there is only one version
of BBC1 available in any part of the United Kingdom, I would hope
we are talking in two or three years' time there might be two
versions which would open up all these possibilities.

Chairman

78. Thank you very much, gentlemen. You will
be glad to know we have exhausted all of our questions to you.
If there are any other points you would like to make please feel
free to do so now.
(Sir Robert Smith) Perhaps just a couple of things.
We have talked about the increased resources from about £95
to £160 million. The hope isand I know it is outside
the news and current affairs areathat will help us to build
up in factual and entertainment and other areas which will get
BBC Scotland creating a very healthy independent sector as well
as home grown sector in Scotland which will perhaps rival the
pre-eminence we have in children's television where we are known
second only to the big operation in London. I think the money
that is mentioned is in addition to all of the money that we are
spending on Pacific Quay, that is a move of headquarters which
is additional money altogether. In case there is anything after
the robust performance here, in case you think it is all complacency,
the Broadcasting Council keeps a watch on these characters. There
have been a couple of examples just in the last year where we
have given them a hard time on transmission problems in South
West Scotland which has now been addressed and where we were concerned
about Europe, that is being addressed. It is not a sleeping watchdog
here, we do shake them up from time to time but generally we believe
that they are doing a good job. Gaelic has not been mentioned.
It might not be a burning issue in the halls of Westminster but
it is important to a number of people. BBC Scotland gets very
high marks for what it produces there on news and current affairs.
We were mentioning Europe earlier and maybe coverage could be
improved. Let me tell you there is a programme Eorpa, even
if you just look at the subtitles it is the best European programme
in my view on television anywhere. It tells you about real issues
in Europe. Finally, can I say we will be looking at news and current
affairs after the Scottish Parliament has risen and that will
be after May next year. I wish we had different vocabulary other
than Scottish 6 because it just raises all sorts of historical
things whereas, in fact, the whole issue is about editorial control
in Scotland and how it works with London. We have moved a long,
long way from where we were two and a half years ago and I think
we need to look at where we are now, is it sufficient, if it is
not sufficient do we need better editorial control in Scotland?
If that is the right thing then we will be taking that to the
Board of Governors and arguing the case there.

79. Thank you. John?
(Mr McCormick) May I just add a sentence at the end,
Chairman. We are very interested in this discussion this morning
and thank you very much for allowing us the opportunity to talk
about our work. Certainly if any Members want to come and visit
any part of our operation or ask one of us or some of our colleagues
to come and give a briefing here about what we are up to and what
we are planning to be up to so there is closer interrogation of
any aspect of it, certainly we would welcome that. We welcome
going over the Pacific Quay plans with anybody, taking you to
the site in Dumbarton and seeing what goes on behind the scenes
at Queen Margaret Drive or in Edinburgh or in Broadcasting House
in Glasgow. You would be very welcome. Thank you for this opportunity.

Chairman: Thank you very much indeed,
gentlemen. Your evidence will be very helpful to us when it comes
to making our report. Thank you very much.